Xstrata to invest 6 billion dollars in Mauritania: minister

12th November 2010, 0 comments

Swiss mining group Xstrata is to invest about 6.0 billion dollars (4.4 billion euros) in the production of iron in Mauritania, the country's mining minister has said.

"This mining giant ... has decided to invest more than 6.0 billion dollars in Mauritania, which shows the role our country is called on to play in the global mining sector," Mohammad Abdallah Ould Oudaa said during a mining conference in Mauritania that ended Thursday.

Xstrata on Friday said it was "far too early in the process to commit to numbers but Xstrata is committed to creating a world-class iron ore business and clearly Mauritania will play a key part in that objective."

"We look forward to working with the Mauritanian government and other relevant stakeholders to achieve this."

The company also disclosed that it now controlled 50.1 percent of the Australian group Sphere Minerals, which is part of a 50-50 joint venture with the Mauritanian national industry and mining company SNIM in three projects.

The largest project, based in Guelb El Aouj in northern Mauritania, is expected to produce 7.0 million tonnes of iron a year.

Xstrata launched its bid for Sphere in August in an operation that eventually valued the Australian company at 513.6 million Australian dollars (506 million US dollars, 370 million euros).

The Mauritanian minister also said his country planned to boost gold production thanks to investment from the Canadian company Kinross at a mine in Tasiast, north of the capital Nouakchott.

"Reserves (of gold) at the mine will reach about 20 million ounces by mid-2011, making it one of the biggest gold mines in the world," he said Thursday.

Annual production will eventually come to one million ounces a year from 250,000 at present, he added.